In this application, our goal is to understand the molecular and cellular mechanisms involved in the differentiation of the foregut. Preliminary studies have indicated that the Sonic hedgehog (Shh) gene is required in foregut development. Absence of Shh results in severe foregut defects that are reminiscent of a spectrum of human foregut malformations, including esophageal stenosis and atresia, tracheoesophageal fistula, and lung hypoplasia. The defective separation of the primitive foregut into the respiratory and digestive tracts in Shh mutant embryos suggests that Shh plays an important role in normal foregut partitioning. Shh is expressed in the primitive foregut endoderm, making it likely that the normal separation of the foregut endodermal derivatives, the tracheal primordium and the future esophagus, is mediated by inductive processes involving the adjacent splanchnic mesoderm. Our proposal is aimed at testing the following hypotheses: (1) Shh signaling is essential for normal development of the foregut, (2) localized Shh activity is essential for proper patterning of the foregut, (3) Shh genetically interacts with Gli3 in foregut development. To accomplish these aims, we will conduct genetic epistasis experiments and perform extensive morphological and molecular analyses of the mutant foregut. We will generate mouse mutants expressing the diffusible form of Shh using a novel genetic approach. We will also conduct functional studies using recombinant and organ cultures. The results obtained from these experiments will add greatly to our understanding of Shh inductive signaling in foregut patterning and differentiation, and shed new light on the etiology of foregut- associated anomalies in humans.